PRINTER'S NO. 1553
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No.
1391
Session of
2023
INTRODUCED BY SHUSTERMAN, HILL-EVANS, MADDEN, CIRESI, SANCHEZ,
SIEGEL, NEILSON, BRIGGS, CONKLIN AND GREEN, JUNE 13, 2023
REFERRED TO COMMITTEE ON TOURISM AND ECONOMIC AND RECREATIONAL
DEVELOPMENT, JUNE 13, 2023
AN ACT
Amending the act of March 4, 1971 (P.L.6, No.2), entitled "An
act relating to tax reform and State taxation by codifying
and enumerating certain subjects of taxation and imposing
taxes thereon; providing procedures for the payment,
collection, administration and enforcement thereof; providing
for tax credits in certain cases; conferring powers and
imposing duties upon the Department of Revenue, certain
employers, fiduciaries, individuals, persons, corporations
and other entities; prescribing crimes, offenses and
penalties," providing for the tourism marketing and promotion
tax credit.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. The act of March 4, 1971 (P.L.6, No.2), known as
the Tax Reform Code of 1971, is amended by adding an article to
read:
ARTICLE XIX-J
TOURISM MARKETING AND
PROMOTION TAX CREDIT
Section 1901-J. Definitions.
The following words and phrases when used in this article
shall have the meanings given to them in this section unless the
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context clearly indicates otherwise:
"Contribution." A donation of cash, personal property, in-
kind contributions or tourism marketing and promotion services,
the value of which is determined by the department.
"Department." The Department of Community and Economic
Development of the Commonwealth.
"Pass-through entity." A partnership as defined under
section 301(n.0) or a Pennsylvania S corporation or small
corporation as defined under section 301(n.1) and (s.2).
"Qualified tax liability." The liability for taxes imposed
under Article III, IV or VI. The term includes the liability for
taxes imposed under Article III on a shareholder of a
Pennsylvania S corporation. The term does not include tax
withheld by an employer from an employee under Article III.
"Tax credit." The tourism marketing and promotion tax credit
established under this article.
"Taxpayer." An entity subject to tax under Article III, IV
or VI. The term includes the shareholder of a Pennsylvania S
corporation that receives a tourism marketing and promotion tax
credit.
Section 1902-J. Tourism marketing and promotion tax credit.
(a) Establishment.--The tourism marketing and promotion tax
credit is established to promote tourism. The department shall
administer the tax credit as provided under this article.
(b) Eligibility.-- The department may award a tax credit for
contributions made to and accepted by the department . The
department shall, by November 1, notify the following:
(1) The Department of Revenue of the amount of the award
up to the capped amount, including:
(i) the name of each donor;
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(ii) the Federal entity identification number of
each donor; and
(iii) the value of each contribution.
(2) The taxpayer of the award.
(c) Amount of tax credits.--The amount of the tax credit for
the taxable year shall be 55% of the value of contributions made
to the department under subsection (b).
(d) Limitation on single taxpayer tax credits.--No single
taxpayer shall receive more than 20% of the total amount of tax
credits authorized under this article in a fiscal year.
(e) Claim.--A taxpayer awarded a tax credit by the
department under this section may claim the tax credit against
qualified tax liabilities incurred in the taxable year in which
a contribution is made.
Section 1903-J. Carryover, carryback, refund and assignment of
tax credit.
(a) General rule.--If the taxpayer cannot use the entire
amount of the tax credit for the taxable year in which the tax
credit is first approved, the excess may be carried over to
succeeding taxable years and used as a tax credit against the
qualified tax liability of the taxpayer for those taxable years.
Each time the tax credit is carried over to a succeeding taxable
year, the tax credit shall be reduced by the amount that was
used as a tax credit during the immediately preceding taxable
year. The tax credit under this article may be carried over and
applied to succeeding taxable years for not more than three
taxable years following the first taxable year for which the
taxpayer was entitled to claim the tax credit.
(b) Application of tax credit.--A tax credit approved by the
department in a taxable year first shall be applied against the
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taxpayer's qualified tax liability for the current taxable year
as of the date on which the tax credit was approved before the
tax credit can be applied against any tax liability under
subsection (a). A taxpayer may not carry back, obtain a refund
of or sell or assign the tax credit.
Section 1904-J. Pass-through entity.
(a) General rule.--If a pass-through entity has any unused
tax credit under section 1902-J, the pass-through entity may
elect in writing, according to procedures established by the
department, to transfer all or a portion of the tax credit to
shareholders, members or partners in proportion to the share of
the pass-through entity's distributive income to which the
shareholder, member or partner is entitled.
(b) Limitation.--A pass-through entity and a shareholder,
member or partner of a pass-through entity may not claim the tax
credit under subsection (a) for the same contributions.
(c) Application of tax credit.--A shareholder, member or
partner of a pass-through entity to whom a tax credit is
transferred under subsection (a) shall immediately claim the tax
credit in the taxable year in which the transfer is made. The
shareholder, member or partner may not carry forward, carry
back, obtain a refund of or sell or assign the tax credit.
Section 1905-J. Annual cap on tax credits.
The total amount of tax credits approved under this article
may not be more than $25,000,000 in a fiscal year.
Section 1906-J. Report to General Assembly.
The department shall submit an annual report to the General
Assembly indicating the effectiveness of the tax credit not
later than June 30 following the year in which the tax credit
was established. The report shall include the names of all
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taxpayers awarded the tax credit as of the date of the report
and the amount of tax credits approved by each taxpayer.
Notwithstanding any law providing for the confidentiality of tax
records, the information contained in the report shall be public
information.
Section 1907-J. Regulations.
The department may promulgate regulations or guidelines
necessary for the implementation and administration of this
article.
Section 1908-J. Expiration.
This article shall expire July 1, 2028.
Section 2. This act shall take effect in 60 days.
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